Diversified machinery company Robbins & Myers Inc. (RBN: Quote) on Tuesday reported a 38 percent decline in profit for the third quarter despite higher revenues. However, adjusted earnings per share from continuing operations increased from last year.
Looking ahead, the company forecast earnings for the fourth quarter below analysts' estimates and narrowed its earnings outlook for fiscal 2012. The company also said its board of directors has authorized a new program for the company to repurchase up to an additional two million shares.
Robbins & Myers makes engineered, application-critical equipment and systems for the energy, industrial, chemical, and pharmaceutical sectors.
Dayton, Ohio-based Robins & Myers noted that the energy service segment had outstanding operating performance and built backlog despite rig count growth stalling along with declining crude oil prices. In the process & flow control segment, the company continued to see stronger demand in the chemical and industrial markets.
Sales for the third quarter grew 12 percent to $266.34 million from $237.06 million in the same period last year, but missed analysts' consensus estimate of $267.18 million.
Customer orders for the quarter rose 10 percent, excluding the impact of currency translation, to $286 million. Backlog at the end of the quarter was $315 million, up from $248 million a year ago.
Net income for the third quarter was $44.23 million or $1.02 per share, down from $70.96 million or $1.54 per share in the same period last year.
The latest quarter's results included favorable benefits of $0.07 per share from tax accrual adjustments, along with benefits from a legal settlement of $0.03 per share.
The prior-year quarter's results include income from discontinued operations of $52.04 million.
Excluding one-time items, earnings from continuing operations rose to $0.92 from $0.68 in the prior-year period. On average, twelve analysts polled by Thomson Reuters expected the company to report earnings of $0.90 per share. Analysts' estimates typically exclude special items.
Looking ahead to the fourth quarter, Robbins & Myers forecasts earnings per share of $0.90 to $1.00, which excludes about $0.08 of higher than normal tax cost related to structural changes that are expected to benefit future years. Analysts expect the company to earn $1.05 per share.
The company said its short-term outlook was more cautious due to overall concerns around global economic growth and the impact this has had on crude oil prices.
For fiscal 2012, Robbins & Myers narrowed its earnings outlook. The company now expects earnings from continuing operations of $3.45 to $3.55 per share, compared to the prior range of $3.40 to $3.60 per share. Analysts expect earnings of $3.55 per share for the year.
Additionally, Robbins & Myers declared a quarterly cash dividend of $0.05 per share, payable on August 10 to shareholders of record as of July 11.
In Tuesday's regular session, RBN is trading at $40.47, down $0.81 or 1.96 percent on a volume of 7,300 shares.
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by RTT Staff Writer
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